Dell Set To Enter Digital Home Market

Speaking Wednesday at the Technology Review Emerging Technologies Conference at MIT in Cambridge, Mass., Dell hinted that the company is set to come out with TV display monitors, just as competitor Gateway has done with its plasma displays.

"What is the difference between a monitor and a television? Not very much," he said. "We are the largest provider of LCD monitors in the world."

"If you think about the home, the PC is becoming more and more the center of the entertainment experience," Dell said, noting that the PC is not just a computing device but a source for music, television and videos.

Connecting the digital home will likely be a wireless network with all audio and video devices attached to it, Dell said. Today, all of those different home audio/video devices are "proprietary islands," he said.

He pointed out that 50 percent of all PCs in Japan are used as televisions. As for the evolution of the digital PC, Dell said there are lots of individual digital home components that can be integrated into the PC.

Dell said he foresees a lot of room for the company to grow from the consumer market into clustered servers to services.

"It's an $800 billion IT market," he said. "A significant portion of that will commoditize or standardize over the next five to ten years, and that is where we play."

As for the company's services and channel strategy, Dell pointed out that the company's services business is growing as much as three times faster than the product business. "Certainly we are working with partners who add unique value," he said.

The company has a significant managed services business that includes 2 million users. Dell said the company sees the opportunity to standardize services as it has PC products and storage.

In some cases, Dell can drop prices by 40 percent to 50 percent by providing repeatable services to customers, he said.

When asked what he believes is the bigest threat to the company's business model, Dell said, "Dell failing to execute."

He poitned out that there are always competitors trying "to catch us," but his biggest fear is "someone coming up, something better ..."

The Internet had "great potential" to disintermediate Dell and its customers, but Dell used the Interent to its advantage.

As for advice for young entrepreneurs in the audience, Dell said, "Don't be afraid to experiment and make a lot of mistakes. Get help and focus on building your team. You may be bright and talented, but you can't do it all."

Furthermore, Dell said that being "curious and learning" is important, but "if you want massive success, you're not going to get there by trying to do something a little better. You've got to do something incredibly better."